White House works to save port deal

The White House is scrambling to rescue a deal giving Dubai-owned DP World control of operations at six major US ports and to limit the political fallout from the controversial arrangement.

22 Feb 2006 18:45 GMT

DP World runs ports in several countries besides Dubai

George Bush, the US president, was unaware of the pending sale of shipping operations at six major US seaports to the state-owned business in the United Arab Emirates until the deal already had been approved by his administration, the White House said on Wednesday.

Bush's chief spokesman, Scott McClellan, said on Wednesday that the US president had only learned about the deal "over the last several days", once it was completed, saying questions about it "didn't rise to the presidential level".

But "the counter-terrorism experts looked at it. The intelligence community did an assessment to make sure that there was no national security threat", McClellan said.

Bush has vowed to veto any legislation stalling the deal, which congressional critics say would hand sensitive seaport activities to a country with a spotty record on battling terrorism.

Uncomfortable questions

One Republican congressional aide, who requested anonymity, said the White House should have realised that the agreement raised uncomfortable questions about national security - a key issue in the run-up to the November legislative elections.

Unless US lawmakers prevent it, Dubai Ports World's acquisition of the British firm that manages the ports is to be finalised on 2 March.

Bush has threatened to veto anylegislation to stall the port deal

Ports affected by the deal are in New York; Miami; New Jersey; Baltimore, Maryland; New Orleans, Louisiana; and Philadelphia, Pennsylvania.

The White House has been surprised and stung by lawmakers' opposition to the agreement, which may face congressional hearings and lawsuits to block it despite Bush's aggressive effort to save it.

"The president believes it is the right thing to do. We shouldn't be holding a Middle Eastern company to a different standard than a British company," said McClellan, who said halting the deal would send a "terrible message".

"The United Arab Emirates is a strong partner in the war on terrorism. We work very closely with them," the spokesman said, praising "the superb military-to-military cooperation that goes on".

Security operations

"They are a country that has worked with us to crack down on terrorist financing. They have worked with us when it comes to intelligence-sharing," McClellan said.

The spokesman stressed that security operations would remain under the control of the US government, with the US Coast Guard overseeing the physical security of the ports and the US Customs and Border Patrol watching cargo shipments.

"(The UAE) are a country that has worked with us to crack down on terrorist financing. They have worked with us when it comes to intelligence-sharing"

Scott McClellan,President Bush's chief spokesman

McClellan also denied suggestions of a conflict of interest tied to Bush's nominee to run the US Transportation Department's Maritime Administration, David Sanborn, a former executive of Dubai Ports World.

"He was nominated to run the Maritime Administration because of his experience and expertise," he said. "My understanding is also is that he has assured us that he was not involved in the negotiations to purchase this British company."

If Bush vetoed legislation upsetting the deal, it would be the first time since he took office in January 2001 that he used that presidential prerogative - and it might lead the US Congress to override him.

Democratic Senator Robert Menendez of New Jersey said he believed the Senate would be able to muster the 67 votes needed to override a Bush veto, while Republican leaders in the Senate and House of Representatives have also called for freezing the agreement.